De-risking development of medium density housing to improve housing affordability and boost supply

Sharam, Andrea, Bryant, Lyndall, & Alves, Thomas (2015) De-risking development of medium density housing to improve housing affordability and boost supply. Australian Planner, 52(3), pp. 210-218.

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Abstract

Housing price inflation is a national concern given the serious decline in the number of low and middle income households able to purchase housing. In addition housing supply lags well behind demand. In Melbourne, urban consolidation policies explicitly seek intensification to promote housing supply but planning regulation is often criticised for being a significant cost driver for medium density housing. It is assumed that easing supply constraints will improve affordability. We suggest that laissez-faire planning exacerbates affordability issues because this approach fails to address the basic economic problem: the current inability of the market to efficiently match supply and demand in order to progress an orderly and de-risked development process. The role of “exchange” one of the four housing market sub-systems identified by Burke (2012) has until recently generally been ignored but our examination reveals significant economic transaction costs that manifest as development risks that impact on affordability. Fortunately these can be mitigated, but only if there is a more consumer driven supply response.

Impact and interest:

1 citations in Scopus
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ID Code: 84894
Item Type: Journal Article
Refereed: Yes
Additional Information: Published online 11 June 2015. The embargo on the accepted manuscript version will expire on 11 December 2016.
Keywords: Housing affordability, Residential development, Housing supply, Medium density housing, Planning
DOI: 10.1080/07293682.2015.1034146
ISSN: 2150-6841
Subjects: Australian and New Zealand Standard Research Classification > BUILT ENVIRONMENT AND DESIGN (120000) > URBAN AND REGIONAL PLANNING (120500) > Housing Markets Development Management (120503)
Australian and New Zealand Standard Research Classification > BUILT ENVIRONMENT AND DESIGN (120000) > URBAN AND REGIONAL PLANNING (120500) > Urban Analysis and Development (120507)
Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > COMMERCIAL SERVICES (150400) > Real Estate and Valuation Services (150403)
Divisions: Current > Schools > School of Civil Engineering & Built Environment
Current > QUT Faculties and Divisions > Science & Engineering Faculty
Copyright Owner: Copyright 2015 Taylor & Francis
Copyright Statement: The Version of Record of this manuscript has been published and is available in Australian Planner, 11 June 2015, http://www.tandfonline.com/10.1080/07293682.2015.1034146
Deposited On: 18 Jun 2015 23:26
Last Modified: 18 Dec 2016 17:06

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